The imposition, collection and administration of income tax in Nigeria are basically statutory, which had undergone significant reforms with the object of providing solutions to the lingering problems of enforcement procedures. The existing body of literature on taxpayer compliance developed over the years in Nigeria. Nigeria made considerable investment in tax legislative reforms, taxpayer education programs, tax enforcement strategies, and sophisticated system of tax administration using new technologies. However, what prompted this research work is that despite those reforms, reviews and changes in the legislation compared to its counterparts, Nigeria faced quite different challenges and constraints that require careful consideration in designing appropriate and effective tax system. In particular, the tax system in Nigeria must foster sustainable economic growth, ensuring that the necessary revenue collections are made to provide for political stability, investment in infrastructure and improved standards of living. The method of acquiring data and information used in this research work was doctrinal, where two main sources of acquiring data, i.e. primary source, which consist of statutes and case laws and secondary source which consists relevant information from leading authorities, textbooks on tax laws and practices, writings and articles of scholars, magazines, opinions of jurists, journals, periodicals, seminar papers, as well as internet/websites, etc. were also used. the findings of the research work were that; (i) Nigeria has both limited administrative resources and expertise, (ii) Tax administration is generally weak, with widespread evasion, corruption and coercion, (iii) Furthermore, taxpayers tend to have low levels of literacy, low tax morale and negative attitudes towards government, (iv) The cash economy, and its inherent opportunities for engagement in fraud and tax evasion, often plays a major role. (v) There is also conflict of tax jurisdiction between the Federal Government and states, and lack of public enlightenment. The central aim of this research appraised the income tax enforcement procedures, and the objectives identified and highlighted their problems and prospects, with particular reference to the relevant Nigerian Tax Laws. The research work finally provided workable suggestions and recommendations to the identified problems to enhance an effective and efficient tax administration in Nigeria. The findings of this research work explored recent issues, challenges and recent ideas of judges/decisions of courts in respect of income Tax under the Nigerian Tax System and Fiscal policies which, if appropriately utilized, will bring enormous change and enhance the Nigerian tax system generally. It also improved the existing enforcement procedures of the Nigerian tax system both at the Federal, states and local levels.


  • Background to the Study

Income tax is one of the major sources of revenue to all governments world- wide, including Nigeria. It is levied by governments to raise revenue that will help in the administration of governmental policies. The role of each government is, first, to provide good governance. Good governance, on the other hand, simply means provision of basic infrastructures, to meet the basic needs of citizens in an atmosphere where peace and security are guaranteed. Revenues generated through income tax enable government to maintain law and order and other socio-economic, political and cultural activities. In order to attain this, every government must put in place a rational income tax system where tax payments are made by every tax-payer and the canons of taxation upheld.
Over the years, the Nigerian tax system has undergone significant changes. The tax laws have been reviewed with the aim of repealing the obsolete taxing laws to enhance effective means for procedures of enforcing the payment of income tax to meet up with the current demands of the Nigerian fiscal programmes and to reduce tax evasion and tax avoidance in the Nigerian tax system.
Nigerian tax system is basically and purely statutory. The tax system, therefore, featured wide range of statutes by which the Nigerian government, as a whole, seeks to
charge and collect taxes for public expenditures. Hence, there has been a requirement that if at all government was to interfere with property, pry into a man’s affairs and take his money, then, this must be on clear statutory authority1. This requirement is premised on the need to protect the individual from the state2. It is trite that, any tax which is not prescribed by law is illegal and unenforceable. It was held, in the case of Seven up Bottling Company v. Lagos State Internal Revenue Board,3 that:
It has often been the view of the Courts here and elsewhere that if a person sought to be taxed comes within the letter of the law, then such a person must be taxed. On the other hand, if the tax authority seeking to recover tax from a person is unable to bring him within “the letter of the law”, the person will be free, however apparently within the spirit of the law his case ought to otherwise appear to be.


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